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    AMKR
    Earnings call· Mar 2026(Q1 FY26)

    AMKOR TECHNOLOGY Q1 FY26 earnings call AMKR

    Apr 27, 2026 Source

    Executive summary

    Amkor Technology Q1 FY26 — Record Revenue and Advanced Packaging Momentum

    Amkor Technology delivered a strong first quarter, marked by record revenue and broad-based demand across end markets, particularly in communications and AI/data center. The company is actively preparing for significant advanced packaging ramps in the second half of the year and beyond, with strategic investments in new facilities in Arizona and Korea. Management highlighted a constructive pricing environment and ongoing efforts to manage supply chain dynamics and cost pressures.

    Highlights

    5

    • Record Q1 revenue of $1.68 billion, up 27% year-on-year, exceeding guidance midpoint.

    • Communications revenue increased 42% YoY, driven by premium tier smartphones, with full-year outlook upgraded to low double-digit growth.

    • Gross margin of 14.2% exceeded the high end of guidance, up 52% YoY, driven by favorable product mix and cost management.

    • AI/data center revenue saw broad-based strength, with advanced packaging revenue on track to triple year-over-year in FY26.

    • Strong balance sheet with $1.8 billion in cash and short-term investments and $2.9 billion total liquidity.

    Concerns

    3

    • Customer supply material delays caused $50 million to $100 million pushout of materials in Q1, with similar impact expected in Q2.

    • Geopolitical events in the Middle East are putting additional pressure on material pricing, requiring active management with customers.

    • Dilution to operating income margin of approximately 1% to 2% is anticipated starting in 2027 due to Arizona facility ramp-up costs.

    Guidance & targets

    11
    CategoryTargetConfidence
    Revenue
    $1.75 billion and $1.85 billion
    high materiality
    High
    Gross margin
    14.5% and 15.5%
    medium materiality
    High
    Operating expenses
    approximately $120 million
    medium materiality
    High
    Effective tax rate
    around 20%
    low materiality
    High
    Net income
    between $105 million and $130 million
    high materiality
    High
    EPS
    $0.42 and $0.52
    high materiality
    High
    CapEx
    $2.5 billion to $3 billion
    high materiality
    High
    Operating income margin dilution from Arizona facility
    approximately 1% to 2%
    medium materiality
    High
    Arizona facility revenue scaling
    meaningful revenue
    high materiality
    High
    AI advanced packaging revenue growth
    tripling
    high materiality
    High
    Communications market full year growth
    low double digits
    medium materiality
    High

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    Communications
    Largest contributor to year-on-year growth, driven by healthy demand across premium tier smartphones, especially iOS, and healthy Android demand. Expected to be stronger than seasonal in Q2, increasing mid- to high single digits sequentially.
    		—42%——
    Computing
    Record revenue within AI data center applications driven by broad-based strength across multiple customers, partially offset by softness in PCs and laptops. Expected to grow mid-single digits sequentially in Q2, driven by the ramp of a new HDFO data center CPU device.
    		—19%——
    Automotive and Industrial
    ADAS and infotainment demand drove record revenue for advanced technology. Recovery in the mainstream portion continued, marking the fourth consecutive quarter of sequential growth. Expected to grow mid-single digits sequentially in Q2.
    		—28%——
    Consumer
    Due to broad-based improvement in demand across customers. Expected to grow low teens percent sequentially in Q2, driven by wearable products.
    		—4%——

    Operational metrics

    15
    Non-GAAP gross margin
    14.2%up 52% YoY
    Q1 FY26

    Exceeded the high end of Q1 guidance range.

    Non-GAAP operating margin
    6%up 360 bps YoY
    Q1 FY26
    Adjusted EBITDA
    $285 million
    Q1 FY26
    Cash and investments balance
    $1.8 billion
    as of March 31
    Total liquidity
    $2.9 billion
    as of March 31
    Total debt
    $1.4 billion
    as of March 31
    Debt-to-EBITDA ratio
    1.1x
    as of March 31
    CapEx spend
    ~$275 million
    Q1 FY26

    Q1 spend came in lower than expected, but CapEx payable increased $200 million.

    CapEx allocation
    65% to 70%
    FY26
    CapEx allocation
    30% to 35%
    FY26
    CHIPS Act grant
    $400 million
    Future

    Part of government incentives for Arizona facility.

    Investment tax credit
    35%
    Future

    Part of government incentives for Arizona facility, contributing to $2.8 billion total support.

    Total government support for Arizona
    $2.8 billion
    Future

    Includes CHIPS grant and investment tax credit.

    Material supply delay impact
    $50 million to $100 million
    Q1 FY26

    Similar level expected in Q2 FY26.

    Arizona facility revenue potential
    $1 billion+>10% of 2025 revenue
    Annual run rate

    Expected to reach this run rate by 2030 once at full scale.

    Industry KPIs

    4
    MetricValueDetails
    Ai data center revenueTriplingYoY growth
    Fab capacity utilizationLow 70s%
    Design wins socket pipelineOver 5 customerscustomers
    End market segment revenue mixCommunications: 42% YoY; Computing: 19% YoY; Automotive and Industrial: 28% YoY; Consumer: 4% YoY%

    Product announcements

    1
    ProductTypeDetails
    HDFO platforms (SWIFT, S-Connect)milestone

    Deals & partnerships

    1
    IntelCollaboration related to providing additional outsourced modeling for EMIB.

    Activity is continuing.

    Capital programs

    2
    Arizona Campus Phase 1underway$7 billion
    Funding: CHIPS grant ($400M), 35% Investment Tax Credit, customer contributions, Amkor liquidity/debt capacity
    Start: Underway

    Benefit: Potential $1 billion+ annual revenue run rate

    Phase 1 construction planned to be completed in 2027. Production expected in 2028. Anticipated 1-2% dilution to operating income margin starting 2027, improving 2028. Modest revenue in 2028, scaling meaningfully in 2029, full impact by 2030. Total $7 billion for 2 phases.

    Korea Test Buildingon track
    Start: Underway

    Benefit: Incremental space to support data center demand

    Will provide incremental space to support data center demand going into 2027.

    Risks & headwinds

    4
    Customer supply material delaysQ1 FY26, similar expected in Q2 FY26

    $50 million to $100 million pushout of materials

    Mitigation: Prioritizing production where materials are available to minimize impact; managing risks with agility alongside customers and suppliers.

    Geopolitical events in the Middle EastOngoing

    Additional pressure on material pricing

    Mitigation: Working closely with customers to offset these increases across the supply chain.

    Export controls and trade policiesOngoing

    Industry backdrop remains dynamic

    Mitigation: Closely monitoring and evaluating; ready to balance if restrictions accelerate or loosen.

    Arizona facility ramp-up costsBeginning in 2027, improving in 2028

    Approximately 1% to 2% dilution to operating income margin

    Mitigation: Expected as part of the investment cycle; once at full scale, Arizona is expected to be a significant driver of operating income margin expansion.

    What to watch in Q2 FY26

    5

    Gross margin trajectory

    H2 FY26
    Current14.2% (Q1 FY26 actual), 14.5%-15.5% (Q2 FY26 guidance)
    TargetMid-to-high teens

    Why it matters

    Indicates the effectiveness of pricing actions, utilization improvements, and favorable product mix in driving profitability.

    So as we look out to the second half of the year, we're still seeing our gross margins being able to rise in that mid- to high teens level given the increase in utilization as well as the ramp expected for our compute segment surrounding the data center.

    Q&A highlights

    7

    How will supply delays and pricing pressure net out against increased loadings and better mix for H2 gross margins?

    Management expects gross margins to rise to mid-to-high teens in H2, driven by increased utilization, the compute segment ramp (favorable product mix), and constructive pricing environment offsetting cost increases. Material supply delays caused $50M-$100M pushout in Q1, similar expected in Q2, but utilization not impacted due to other demand.

    “we expect that would cover most of those cost increases. So as we look out to the second half of the year, we're still seeing our gross margins being able to rise in that mid- to high teens level given the increase in utilization as well as the ramp expected for our compute segment surrounding the data center.”

    asked by James Schneider · answered by Megan Faust

    2 min read6 chapters

    Detailed Narrative

    01

    Strong Q1 Performance and End-Market Dynamics

    Amkor reported record Q1 FY26 revenue of $1.68 billion, a 27% YoY increase, surpassing the midpoint of guidance. Growth was observed across all end markets, with communications leading at a 42% YoY increase, driven by premium tier smartphones. Computing revenue grew 19% YoY, boosted by AI data center applications, while automotive and industrial revenue rose 28% YoY, with ADAS and infotainment driving advanced technology demand. Consumer revenue increased 4% YoY due to broad-based improvement.

    02

    Advanced Packaging and Technology Leadership

    The company continues to invest in advanced packaging platforms like HDFO, flip chip, and test, critical for AI and high-performance computing. A new data center CPU program is expected to ramp in Q2, contributing meaningful revenue in Q3 and beyond. Amkor is engaged with over five customers on HDFO platforms (SWIFT, S-Connect) and more than half a dozen customers on 2.5D silicon interposer technologies, indicating broadening customer engagement.

    03

    Geographic Expansion and Capacity

    Construction of Phase 1 of the Arizona facility is on track for completion in 2027, with production expected in 2028. This facility is projected to eventually achieve a $1 billion+ annual revenue run rate. In Korea, a new test building is set for completion by the end of 2026, providing incremental space for data center demand into 2027. Vietnam is also seeing SiP product migration from Korea to optimize space and utilization.

    04

    Margin Improvement and Cost Management

    Gross margin reached 14.2% in Q1, exceeding guidance due to favorable product mix and focused cost management. Operating income margin improved by 360 basis points YoY to 6%. Management expects gross margins to rise to mid-to-high teens in the second half of the year, driven by increased utilization, the compute segment ramp, and a favorable product mix towards high-value advanced packaging. Constructive pricing discussions with customers are also helping to offset material cost increases.

    05

    Capital Allocation and Funding

    Amkor's FY26 CapEx estimate remains at $2.5 billion to $3 billion, with 65-70% allocated to facilities expansion (including Arizona) and 30-35% for HDFO, test, and other advanced packaging. The company highlighted significant government incentives, including a $400 million CHIPS grant and a 35% investment tax credit, totaling $2.8 billion in support for its Arizona investments. Customer contributions and Amkor's strong liquidity and debt capacity are also part of the funding strategy.

    06

    Supply Chain and Geopolitical Risks

    The company is managing supply dynamics around advanced silicon, advanced substrates, and memory, which caused $50 million to $100 million in material pushouts in Q1, with similar expectations for Q2. Geopolitical events in the Middle East are noted for increasing material pricing pressure, though no supply disruptions have been observed to date. Export controls and trade policies are continuously monitored, but currently do not pose a significant impact.

    AI-generated summary of the company’s earnings call. Not investment advice.